Digital Transformation and the impact on Marketing Organisation Models
Digital transformation is affecting businesses across industries and sectors. It is driven by new technologies, fierce competition and increasing expectations from customers of a ‘digital-first’ experience. And it is affecting almost everyone – Gartner predicts that by 2020, 75% of business will be digital businesses, or preparing to become one. Responding to this transformation requires a change in strategy for most companies and that inevitably has an impact on structure and organisation, ways of working and the relationships between team members and agency partners.
The Marketing and Communications function is often one of the first areas to experience the impact of Digital Transformation. The rapid proliferation of channels and devices compounded by a shift in perceived ownership and management of brands and products from Marketers to consumers, inevitably has an impact on the scope and roles of the Marketing teams. Despite this, although the influence of Digital Transformation started early in the Marketing arena, we are frequently being approached by CMOs from many significant global brands and organisations still trying to work out how they should respond to the dramatic change in strategy and ways of working required.
The reason for their delayed response may be because brand teams have focused on the communications themselves – which channels, what types of content – the where and what of communications, rather than the how. However, it relatively rapidly becomes apparent that the traditional approach to managing and delivering Marketing communications just doesn’t work in a digital environment that demands agile delivery of ‘always-on’ omni-channel multiple assets, built around a complex customer journey – rather than the peaks and troughs of a traditional campaign model. The problem becomes even more complex when the organisation is global and needs to maintain brand consistency and integrity whilst at the same time responding to local nuances and opportunities. And it impacts organisational design and the Ways of Working for the internal teams and their external Agency partners. And those are not things that can be tackled lightly. Therefore, a fundamental reason for the delay in responding to Digital Transformation is that it is actually quite difficult.
So what can they learn from the experience of those who have already started to tackle ‘digital transformation’?
Lack of clarity about what Digital Transformation means
Unhelpfully the phrase ‘Digital Transformation’ has become somewhat overused and lacking in consistent meaning. So in order to give some framework to our consideration we are drawing on Neil Perkin’s and Peter Abraham’s description in their book “Building the Agile Business Through Digital Transformation”. They define it as – “The transformation and reinvention of the resources, priorities and processes of a company in order to be fit for purpose in a digitally empowered world”. Whilst their’s is a broad definition it is still relevant for the context of Marketing Digital Transformation. And specifically, we are narrowing it to ‘within the Marketing Operations field’.
There’s a tendency to add to the confusion
One of the characteristics we’ve observed of companies and brands responding to the digital challenge is a shift to greater complexity. The Agency roster seems to expand rapidly as specialists are introduced to deliver into each of the specific channels. This creates problems in lack of consistency in messaging as well as confusion over boundaries and scope. And above all it creates a heavy burden on the organisation to manage all of these additional agencies with the associated escalation in agency fees and production costs. Sometimes these specialist agencies are introduced to the roster without too much rigour in the selection process, so the quality and calibre of the agency partners can start to suffer.
Within the internal teams the response to Digital Transformation is often “we need more budget” and “we need more resources” – adding to the debate and confusion if these requests for additional funding and resources are met as they can undermine the efficiencies that digital can bring to Marketing.
To enable real transformation the complexity needs to be removed.
There is no ‘silver bullet’
There is no single approach or solution to respond to the impact of Digital Transformation. It very much depends for example, on the strategy of the company, the complexity of the organisation – e.g. centralised / decentralised; global / local, the existing skills and capabilities in the teams – particularly if there is specialist skills and expertise which needs to be protected.
But there is a methodology
Going back to Perkin’s and Abraham’s definition – “The transformation and reinvention of the resources, priorities and processes of a company in order to be fit for purpose in a digitally empowered world” how do you go about tackling the resources, priorities and processes? Whilst there is no single solution there is a proven methodology to deliver the right approach for a company or brand and its strategies.
There are some broad principles that will help:
- Senior management buy-in and sponsorship
- Sensitivity – restructuring and change is disruptive and challenging to many people
- Commitment – you can’t make organisational change lightly
- A clear case for change is essential
- The right team must be in place to deliver it
- On-going support and training for all levels of the organisation
And there are some proven tools and techniques that can guide and structure the analysis of the current state and what the future state should be. In simple terms this involves:
- Analysing the current organisation to catalogue what is working and what is not.
- Confirming the business strategy and objectives.
- Developing design principles and evaluation criteria to guide a choice of possible organisational options
- Evaluating the possible options to arrive at a recommended solution
- Creating a ‘blue print’ for implementation
The Observatory International has a tried and tested approach to reviewing and transforming Marketing Communications teams through our Resource Optimisation model – Discovery | Diagnose | Design | Deliver
The approach is grounded in robust Organisation Design tools and techniques, and deep consultancy experience and expertise from our offices around the world to guide best practice Ways of Working for both internal marketing resource and their external Agency partners.
If you would like further information please contact The Observatory International team on +44(0)20 7571 0415; observatoryinternational.com